Passionate about IP! Since June 2003 the IPKat has covered copyright, patent, trade mark, info-tech, privacy and confidentiality issues from a mainly UK and European perspective. The team is Neil J. Wilkof, Annsley Merelle Ward, Darren Smyth, Nicola Searle, Eleonora Rosati, David Brophy, Alberto Bellan and Merpel, with contributions from Mark Schweizer. You're welcome to read, post comments and participate. You can email the Kats here

From October 2016 to March 2017 the team is joined by Guest Kats Rosie Burbidge and Eibhlin Vardy, and by InternKats Verónica Rodríguez Arguijo, Tian Lu and Hayleigh Bosher.

Monday, 21 September 2009

Both blissfully optimistic and ignorant of the impending downpour that she and her fellow Londoners would experience last Tuesday evening, the AmeriKat left her house that morning without an umbrella or a coat. Over her breakfast Cheerios the AmeriKat listened as the BBC weather report forecast monsoon-like rains. All signs told her she should leave the house prepared but nevertheless, come 8:00 pm, she found herself leaving a torrent of water behind her as she dripped her way home on the Tube. The AmeriKat enjoys how sometimes in life even the most clear and unequivocal forecasts are ignored in favour of optimism that the inevitable will somehow not occur.

Right: prudent pussykats take precautions

No amount of optimism can ignore the fact that the inevitable is forecast to occur in the Google Book Settlement hearing following the US Department of Justice’s Statement of Interest filed last Friday. This declared that the Settlement should be rejected due to its potential antitrust and copyright violations. The 26 page Statement argued that

“A global disposition of the rights of millions of copyright works is typically the kind of policy change implemented through legislation, not through a private settlement.”

The Statement briefly stated that the Settlement “has the potential to breathe life into millions of works that are now effectively off limits to the public” but was quick to proceed to the serious legal concerns the Settlement would effect. The Statement outlined three categories of concern: (1) claims that the Settlement fails to satisfy Rule 23 of the Federal Rules of Civil Procedure, (2) claims that the Settlement would violate copyright law and (3) claims that the Settlement would violate antitrust law.

Rule 23 requires that, in order to ensure that a class action settlement protects the legal rights of absent class members, the settlement must be fair, reasonable and adequate. The US submitted that as currently drafted the Settlement does not satisfy these requirements because “the most sweeping forward-looking licensing provisions” of the Settlement would “give open-ended control to the Registry and Google for the exploitation of the rights of absent class members” and “exacerbate potential conflicts between the interests of the class representatives and those of absent class members.” In particular the US submitted that the Settlement positions the interests of one part of the class - the known rights holders - against another part of the class - orphan works rights holders. Given that Google’s commercial use of orphan works would generate revenues and that any of these unclaimed revenues would benefit the registered rights holders, the US stated that there are “serious reasons to doubt” that these registered rights holders can adequately represent the interests of those who are not fully protected.

The US also addressed the concerns regarding adequacy of representation of foreign rights holders, given that the Settlement “operates to sweep in untold numbers of foreign works.” Most concerning to the US was in relation to “some of the United States’ trading partners concerns” like those of France and Germany. The US stated that the parties “have not demonstrated that the class included representation sufficient to protect the interests of these foreign rights holders.” Additionally, the US pointed out that Google had yet to take any action to address “the concerns of the United States’ trading partners.” The AmeriKat believes that, despite the brevity of the US’s Statement in relation to the foreign works issue, the use of the operative phrase “United States’ trading partners” is a sign post to the court of the seriousness and necessity in rejecting the settlement.

Europe’s “subplot of envy” of Google Book

On 10 September 2009 Marybeth Peters, the head of the US Copyright Office, testified before the House Judiciary Committee that areas of the Settlement were “fundamentally at odds with the law.” Her oral testimony concentrated on the seriousness of settlement in unilaterally establishing a compulsory licensing system, the inability of Congress to pass legislation dealing with orphan works if approved and its violations of international obligations. Peters stated that she believed that Google would be usurping the role of Congress in formulating copyright legislation if the settlement was allowed:

“the proposed settlement inappropriately creates something similar to a compulsory license for works, unfairly alters the property interests of millions of rights holders of out-of-print works without any Congressional oversight, and has the capacity to create diplomatic stress for the United States.”

Preceding Peters' testimony, the testimony of Paul Aiken, the Executive Director of the Authors Guild, may have lent itself to some diplomatic stress when he stated

“In Brussels this week the copyright wars are playing over there as they are here … so we heard the usual debating points. We also detected something new - a subplot of envy. Europeans are starting to size up what we nearly achieved and they like it. They think we are getting a significant advantage … No doubt they will be working hard to catch-up. ”

“A subplot of envy” – is this copyright law’s version of the “axis of evil”?

Whether or not Peters' testimony informed the US’s Statement is unclear, but the AmeriKat does not believe that, with the US government making clear that the Settlement in its present form should be rejected, Judge Chin will have any other choice but to find likewise.

The AmeriKat recommends that readers watch the hearings here (Peters' testimony, at the 41 minute mark).

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